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Inflation is common and normal in a modern economy. This kind of quantity adjustment has been going on for decades. I think you are worried about high inflation
by ZDurmPhoto 5y ago
Inflation is common and normal in a modern economy. This kind of quantity adjustment has been going on for decades. I think you are worried about high inflation and it will be interesting to see what the next few months bring.
But this paper towel example is not outside the bounds of normal inflation.
- missedthecue 5y agoIt's a 14% decrease in purchasing power... is that normal?
- JoshuaDavid 5y agoDepends over what time frame. If it's over a 5-10 year period, that corresponds to a 1-3% annual decrease in the purchasing power of the dollar, which is considered pretty normal. If it's happening much more frequently than that (to the same product), though, it could indicate worrying inflation. Also note that "prices of consumer goods are rising by less than 2% per year" is not proof that the purchasing power of the dollar is roughly stable -- it's possible for consumer goods to get relatively cheaper than assets and positional goods such as e.g. stocks and bonds, housing, healthcare, and education such that it takes many more dollars to buy a certain lifestyle than it used to despite minimal rises in CPI.